Kevin O'Leary said his Utah data center will create 10,000 construction jobs. The real number is far lower.

Kevin O'Leary's ambitious proposal for a data center in Utah has sparked controversy regarding its projected job creation. Initially, O'Leary claimed that the project would generate 10,000 construction jobs and 2,000 permanent positions. However, recent discussions with Paul Palandjian, CEO of O'Leary Ventures, reveal that these figures may be overly optimistic. According to Palandjian, the more realistic estimate for new construction jobs ranges from 4,000 over 10 to 15 years, and this figure comes with caveats. "These numbers are fluid and can change daily," he stated, emphasizing that the revised estimate reflects their current understanding of the project’s scope. Named Wonder Valley, the facility aims to combine a data center with a power plant, potentially achieving a capacity of 9 gigawatts. If fully completed, it could rank among the largest data centers globally. The reality is that data centers typically do not generate a substantial number of permanent jobs in the communities they inhabit. Their economic impact is challenging to quantify, particularly given the ongoing research into the industry. A study from the University of Southern California Marshall School of Business indicates that once a data center becomes operational, its workforce may diminish by an average of 78%. Applying this research, a more accurate projection for permanent positions at Wonder Valley stands at approximately 1,350. An FAQ document available on Utah Governor Spencer Cox's website mentions that the developer has pledged to create 2,000 permanent jobs in skilled trades, logistics, IT, and administrative roles for local residents. However, whether Wonder Valley will meet this goal remains uncertain, particularly as the data center currently lacks a tenant. Palandjian noted that O'Leary Ventures is engaged in preliminary discussions with several significant tech companies. The proposed site for Wonder Valley is part of a larger 40,000-acre area supported by Utah's Military Installation Development Authority, which aims to enhance tax revenues through economic development. A final development agreement is still under negotiation and is anticipated to be finalized within the next month, according to a MIDA spokesperson. A draft of the agreement indicates that the data center will benefit from various tax incentives, including a 100% rebate on personal property tax and an 80% rebate on real property tax for up to three decades. Notably, the agreement does not stipulate a minimum job creation requirement, as Utah provides tax breaks to data centers without such conditions. Locally, the Box Elder County community has expressed significant opposition to the project, raising concerns about water consumption, air quality, and a perceived lack of transparency from officials. In response to these grievances, residents recently filed two referendums aimed at overturning local approvals for the site. O'Leary has dismissed the protesters, suggesting they were brought in from outside the area and arguing that their concerns stem from misunderstandings about the nature of data centers. "Consider the number of jobs involved," he remarked in a recent post on X.